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article imageBitcoin price seems stalled near the $4,000 level

By Ken Hanly     Jan 7, 2019 in Technology
After breaking through the $4,000 level again yesterday, today Bitcoin (BTC) is still just slightly below the level. It appears stuck and is unable to challenge key resistance levels so far.
CoinDesk analysis
Omkar Godbole has his usual daily analysis of the price movements of BTC on CoinDesk. It was last updated 11:14 UTC January 7. Godbole notes that the bears will clearly be beat should BTC break through the key resistance line at $4,140. However, so far BTC has come short of doing that.
Earlier in the day, BTC rose to a two-week high of $4,090 and this ended a week long period of low volume consolidation near $3,800 as well. The move above $4,000 had added credibility to the short-term bearish-to-bullish trend change that was signaled by the three-day chart back on December 20.
Yet the bulls have not been able as yet to break out over the $4,140 resistance level, the neckline of the inverse head-and-shoulders bullish reversal pattern. If BTC does manage to make this break through the bulls would again be back in control.
However, a long-term bullish reversal would be shown only if BTC rises above the 21-month exponential moving average (EMA) at $5,567 presently. When Godboles's article went to press BTC was trading at $4,000 a 5 percent gain over 24 hours.
Chart analysis
The daily chart shows that BTC has formed an inverse head-and-shoulders pattern, indicating a transition from a bear market to a bull market. A breakout from this pattern usually results in a strong move upwards. BTC could rise well above $5,000 if BTC breaks through the $4,140 on high volumes.
BTC's price has found acceptance beyond the 50-day moving average (MA). Also, the 5 ad 10-day MAs are both moving upward showing a bullish configuration. The 14-day relative strength index (RSI) also favors the bulls. The setup favors BTC making a breakthrough of the $4,140 resistance level.
On the monthly chart the situation still appears to favor the bears. BTC is trading below $5,567 the 21-month EMA. The bulls face a daunting task to force a long-term breakout as adding to their problems, the 5 and 10-month EMAs are still trending downwards. The two levels are at $4,791 AND $5,651 and form formidable resistance levels.
Godbole's outlook
Based on his analysis Godbole's view is: "An inverse head-and-shoulders breakout, if confirmed, would signal a major bullish reversal and could yield a quick move to the psychological hurdle of $5,000. A break above the 21-month EMA of $5,567 could see in a long-run bullish breakout. Failure to take out the neckline resistance of $4,140, if followed by a break below $3,566 (low of the right shoulder), will likely embolden the bears and allow re-test of the recent low of $3,122."
Present situation
24 hours ago, BTC was trading at $4,024. It rose as high as $4.048. It had a huge drop to a low of $3,526 early this afternoon but raced back to where the drop started immediately. Since then it has not moved too much. However, at 20:28 Central Standard Time it was trading a bit below the $4,000 mark again at $3,969 a drop of $55 dollars from the open. It seems as if the recent rally above $4,000 is stalled for now. The present price of Bitcoin can be found here.
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